WASHINGTON, D.C. -- -- The Department of Health & Human
Services would conduct "oversight and supervision" of Group Purchasing
Organizations (GPOs) under the provisions of new bipartisan legislation
offered by Senators Herb Kohl (D-Wis.) and Mike DeWine (R-Ohio). The Medical
Device Manufacturers Association (MDMA) hailed the bill as "a critical step"
in addressing the anticompetitive and other questionable practices by certain
GPOs that have long prevented cost-effective medical technologies from
reaching the market.
GPOs operate under a legal "safe harbor" exemption from the anti-kickback
provisions of the Social Security Act. The Kohl/DeWine bill would authorize
HHS, in consultation with the Federal Trade Commission, to ensure that GPOs do
not use the safe harbor to "shield conduct that harms competition in the
hospital supply and medical device industries."
MDMA Executive Director Mark Leahey said the impetus for the legislation
is the fact that "some GPOs have not adequately addressed the anticompetitive
contracting practices that have denied patients access to cost-effective
technologies." Three hearings by the Senate Antitrust Subcommittee and a
series of investigative reports in The New York Times revealed that despite
some improvements, it had become obvious that certain GPOs would not reform
their behavior without federal intervention.
The MDMA has long asserted that the contracting practices of certain GPOs were
effectively locking innovative products out of the hospital marketplace.
Leahey said: "We are grateful to Senators DeWine and Kohl for their
persistence and leadership in ensuring that competition is allowed to flourish
in the hospital supply industry. This legislation will allow healthcare
professionals and the patients they serve to gain access to a wide array of
innovative medical technologies that can save lives."
The Medical Device Manufacturers Association (MDMA) seeks to improve the
quality of patient care by encouraging the development of new medical
technology and fostering the availability of innovative products in the
marketplace. A national trade association based in Washington, D.C., MDMA
represents thousands of innovators and entrepreneurs in the medical device
community, including over 200 dues-paying members who develop and manufacture
medical devices, diagnostic products, and health care information systems.
Source: Medical Device Manufacturers Association